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Cablegate: Japan: Economy, Environment, G8 Prominent in Pm

VZCZCXRO9814
PP RUEHFK RUEHGH RUEHKSO RUEHNAG RUEHNH
DE RUEHKO #0191/01 0240956
ZNR UUUUU ZZH
P 240956Z JAN 08
FM AMEMBASSY TOKYO
TO RUEHC/SECSTATE WASHDC PRIORITY 1223
INFO RUEHBJ/AMEMBASSY BEIJING 1290
RUEHUL/AMEMBASSY SEOUL 7357
RUEHBY/AMEMBASSY CANBERRA 2508
RUEHLO/AMEMBASSY LONDON 1950
RUEHRL/AMEMBASSY BERLIN 1334
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RUEHOT/AMEMBASSY OTTAWA 9605
RUEHMO/AMEMBASSY MOSCOW 2087
RUEHME/AMEMBASSY MEXICO 0475
RUEHBR/AMEMBASSY BRASILIA 0394
RUEHSA/AMEMBASSY PRETORIA 0268
RUEHJA/AMEMBASSY JAKARTA 4322
RUEHNE/AMEMBASSY NEW DELHI 8440
RUEHNAG/AMCONSUL NAGOYA 4338
RUEHNH/AMCONSUL NAHA 8079
RUEHOK/AMCONSUL OSAKA KOBE 9350
RUEHKSO/AMCONSUL SAPPORO 6291
RUEHFK/AMCONSUL FUKUOKA 5685
RUEHGH/AMCONSUL SHANGHAI 0319
RUEHHK/AMCONSUL HONG KONG 6426
RUEHBS/USEU BRUSSELS
RUEHIN/AIT TAIPEI 6866
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RHMCSUU/DEPT OF ENERGY WASHINGTON DC
RUEHC/DEPT OF LABOR WASHINGTON DC
RUEATRS/TREASURY DEPT WASHDC

UNCLAS SECTION 01 OF 03 TOKYO 000191

SIPDIS

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: ECON PGOV SENV JA
SUBJECT: JAPAN: ECONOMY, ENVIRONMENT, G8 PROMINENT IN PM
FUKUDA'S DIET SPEECH

REF: TOKYO 141

Summary
-------
1. (SBU) Prime Minister Yasuo Fukuda launched Japan's 2008
spring Diet session January 18 with a policy speech focused
on livelihood and environmental issues. Laying out five
policy principles, Fukuda stressed a "people first" agenda,
including creation of a new Minister for Consumer Affairs and
renewed efforts to solve the country's pension problems.
While generally complimenting Fukuda's emphasis on
environmental issues, major dailies criticized the speech as
lacking in vision. End summary.

Putting People First
--------------------
2. (SBU) Prime Minister Fukuda put economic and livelihood
issues front and center in his January 18 policy speech,
which marked the opening of this year's spring Diet session.
Looking at how Japan can deal with globalization, growing
international competition, environmental degradation, an
aging and graying society, and an austere fiscal situation,
Fukuda noted Japan's postwar accomplishments and called on
citizens to carve out a new future. He defined his cabinet's
mission as tapping the vitality of the Japanese people to
overcome the nation's challenges.

3. (SBU) PM Fukuda specified five principles to activate
Japan's latent economic power and to spread the benefits of
growth throughout society.

A) Shifting to "administrative and financial policies that
put people first." Fukuda promised to create a new Minister
for Consumer Affairs to champion people's priorities rather
than those of producers and suppliers. Fukuda also promised
better budget implementation, reform of independent
administrative agencies, progress toward achieving a surplus
in the primary fiscal balance by 2011, and maintence of tax
revenues earmarked for road construction -- all policies he
described as aimed toward improving people's daily lives.

B) "Establishing a social security system and ensuring
safety." In addition to explaining his government's efforts
to resolve problems with the nation's pension system, PM
Fukuda promised new family-friendly work and childcare
policies, improvements to the healthcare system, and new
disaster prevention measures.

C) Creating "an economic society with vitality." The Prime
Minister outlined three priorities for the Council on
Economic and Fiscal Policy: 1) acceleration of technological
innovation; 2) increased internationalization of the economy,
including early conclusion of the Doha WTO Round, trade
agreements with Asia-Pacific partners, enhanced transparency,
achieving a doubling of inward FDI, liberalization of
aviation markets, and increased competitiveness of Japan's
financial sector; and 3) measures to spread growth's benefits
to Japan's outlying regions, as well as to small and
medium-sized enterprises.

D) Making "Japan a Peace-Fostering Nation." Citing the
centrality of the U.S.-Japan security alliance to Japan's

TOKYO 00000191 002 OF 003


foreign policy, PM Fukuda stated Japan will resume refueling
activities in the Indian Ocean and continue reconstruction
assistance to Afghanistan and Iraq. As host to this year's
fourth Tokyo International Conference on African Development
(TICAD IV) and the G8 Summit, Fukuda named poverty
eradication and improvements in health and hygiene as
humanitarian engagements Japan would undertake.

E) "Conversion to a low carbon society." Global
environmental issues are "the most serious challenge to
humankind in the twenty-first century," said PM Fukuda,
adding that Japan should capitalize on its energy-saving
technologies to set an international precedent. Fukuda set
the following goals:

-- Fulfilling Japan's Kyoto commitment to reduce greenhouse
gases by six percent and revising Japan's Kyoto Achievement
Plan in 2008 to include further industry efforts and
household energy savings;

-- Using the G8 presidency to lead international efforts to
create a new, effective international policy framework, to
include all major emitters, "with a view to attaining the
long-term goal of halving emissions of greenhouse gases by
2050 in a manner compatible with economic growth";

-- Establishing a financial mechanism that supports
developing countries' efforts to cut greenhouse gases, as
well as measures to counter environmental damage caused by
climate change, including drought and floods;

-- Formulating an "Environmental Energy Technology Revolution
Plan" to foster mid- to long-term development of
revolutionary technologies that would eliminate greenhouse
gas emissions; and

-- Designating ten model cities willing to adopt innovative
technologies and policy measures, with the aim of drastically
reducing greenhouse gas emissions in those areas.

Media Reaction
--------------
4. (SBU) Editorial reaction to Fukuda's speech was mixed.
Fukuda's "people first" consumer focus and emphasis on
climate issues were well-received, but the speech was
characterized as lacking leadership and a strong vision by
major dailies such as the Yomiuri and Mainichi. Moreover,
several papers criticized Fukuda for failing to reassure
people in the face of rising economic anxieties and for
skirting the tough questions of domestic economic reform that
are key to raising Japan's productivity and global
competitiveness.

Comment
-------
5. (SBU) Fukuda's "people first" message is a sharp contrast
to the foreign policy issues that dominated the previous Diet
session. Polling has consistently shown pocketbook issues as
Japanese voters' top concern and the new message is a clear
counter to the themes the opposition Democratic Party of
Japan has been hammering upon since their victory in July
2007's Upper House election.

TOKYO 00000191 003 OF 003


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